COVID pandemic has widened rich-poor gap

Inequality between the rich and poor worsened during pandemic and poverty increased, for the first time in decades. UN labor agency explores rich-poor gap and how the virus has changed the world. Also the ways the pandemic has pushed back efforts to create more equitable societies.

The U.N. labor agency warned that the coronavirus pandemic has led to a massive drop in income for workers around the world. Also noted rising inequality between rich countries that have injected government cash into their economies and poorer countries that can’t.

International Labor Organization estimates that global labor income plunged by $3.5 trillion in the first nine months of 2020. This marks a near-11% drop from a year ago. Lower-income countries and those in the Americas were particularly hit.

Inequalities exposed

Over the past 12 months, COVID-19 has deepened those inequalities. In February, the UN’s labour-focused agency declared that the two billion people working in the informal sector were particularly exposed.

In March, the agency followed up with projections. They suggested that millions could be pushed into unemployment, underemployment, or the grinding condition of working poverty.

This is no longer only a global health crisis, it is also a major labour market and economic crisis that is having a huge impact on people.

Guy Ryder, ILO Director-General

The agency published recommendations on ways to mitigate the damage to livelihoods. These included employee protection in the workplace, economic and employment stimulus programmes. Also income and job support to face the rich-poor gap.

Keeping food supplies flowing

By April, the scale of global suffering became apparent. A UN report shows that poverty and hunger were getting worse. Food crises exposed highly vulnerable countries to the pandemic. “We must keep critical food supply chains operating, so people have access to life sustaining food”, the study said, stressing the urgency of maintaining the delivery of humanitarian assistance “to keep people in crisis fed and alive”.

From using public transport as food hubs, traditional forms of home delivery, and mobile markets, communities have had to find innovative ways to feed the poor and vulnerable, whilst coping with COVID-19 restrictions on movement.

These are all examples of the ways that cities in Latin America try to support their populations. They reflect warnings from the Food and Agriculture Organization (FAO). The health risk for many urban citizens is high during the pandemic. Particularly a risk for the 1.2 billion who live in slums, and other informal settlements.

Women bear the brunt of rich-poor gap

“Women are bearing the brunt of the COVID-19 crisis as they are more likely to lose their source of income and less likely to be covered by social protection measures”. That was Achim Steiner, head of the UN’s development agency UNDP, noting the effect that the pandemic is having on women, pointing to data released in September.

It revealed that the poverty rate for women has increased by more than nine per cent, equivalent to some 47 million women: this represents a reversal of decades of progress to eradicate rich-poor gap and extreme poverty over the last few decades.

Phumzile Mlambo-Ngcuka, UN Women Executive Director, said that the increases in women’s extreme poverty are a “stark indictment of deep flaws”. This came from the stucture of the society and the economy.

Nevertheless, Mr. Steiner insisted that the tools exist to create a huge improvement to women’s lives, even during the current crisis. For example, more than 100 million women and girls could be lifted out of poverty if governments improve access to education and family planning, and ensure that wages are fair and equal to those of men.

One in six children affected

Progress in reducing child poverty also took a hit this year. The UN Children’s Fund, UNICEF, and the World Bank report that some 365 million children were living in poverty before the pandemic began. They both predicted that those figures will rise considerably as a result of the crisis.

Extreme poverty deprives hundreds of millions of children of the opportunity to reach their real potential, in terms of physical and cognitive development, and threatens their ability to get good jobs in adulthood.

“These numbers alone should shock anyone”, said Sanjay Wijesekera, UNICEF Director of Programmes. “Governments urgently need a children’s recovery plan to prevent countless more children and their families from reaching levels of poverty unseen for many, many years.”

Children rich-poor gap

Aid for record numbers

By December, the UN was predicting that a record 235 million people would require humanitarian assistance in 2021. This was an increase of some 40 per cent on 2020 which is almost entirely a consequence of the pandemic.

“The picture we are presenting is the bleakest and darkest perspective on humanitarian needs in the period ahead that we have ever set out”, said the UN’s emergency relief chief, Mark Lowcock. “That is a reflection of the fact that the COVID pandemic has wreaked carnage across the whole of the most fragile and vulnerable countries on the planet.”

Sustainable development and fight against COVID-19 go together

Mr. Lowcock warned that the scale of the challenges facing humanitarians next year are massive – and growing. “If we get through 2021 without major famines that will be a significant achievement,” he said. “The red lights are flashing, and the alarm bells are ringing.”

Time for a new global deal for rich-poor gap

At the end of the year, the UN chief issued a reminder. The levels of poverty and inequality seen this year are far from inevitable. A more equitable world is still possible, regardless of acute shocks such as the pandemic.

Speaking in December, Mr. Guterres expressed his hope that the pandemic could spark the transformations needed to achieve stronger social protection systems worldwide.

Reflecting on his comments on inequality made a year earlier, the UN chief said that the world needs a new Global Deal. This was just before the pandemic was on the horizon. “Where power, resources and opportunities are better shared at international decision-making tables. Governance mechanisms better reflect the realities of today”.

eudebates rich-poor gap